Billions for broadband in stimulus bill appear likely

Groups say $30B may be available

Groups calling for the federal government to spend $30 billion or more to improve broadband networks across the country are optimistic that kind of money will be available in an economic stimulus bill pushed by President-elect Barack Obama, one telecommunications expert said today.

Representatives of Educause have heard during conversations with the Obama transition team and other groups pushing for broadband funding that about $30 billion for broadband is in line with Obama's goals for the stimulus package, said John Windhausen, a consultant at Educause.

Obama and several groups have argued that many U.S. residents are being left out of the digital economy because they don't have broadband access, and a national broadband program could create hundreds of thousands of jobs.

Obama's economic stimulus package could top $800 billion.

Educause, an advocacy group focused on IT use in higher education, called for a $100 billion broadband program in a policy paper (download PDF) released a year ago. The Educause plan would bring 100Mbit/sec. broadband to every home and business in the U.S., and it called on the U.S. government to provide about a third of the money, with private financing making up the rest.

The U.S. is falling behind other countries, both in broadband adoption and in speeds available for innovative online applications, Windhausen said. "If we continue on the same path, we're not going to get the broadband built out the way we need it," he said at the State of the Netconference in Washington.

In recent weeks, Free Press, a media advocacy group, has put out its own proposal (download PDF), for the federal government to spend $44 billion on a broadband rollout, and the Information Technology and Innovation Foundation (ITIF) released a study saying a $30 billion government broadband program would create nearly 950,000 jobs in the U.S.

The three plans differ significantly, with the Educause plan focusing on government grants, the ITIF plan focusing on tax credits, and the Free Press plan advocating a variety of programs. There's also disagreement in Washington whether broadband money in the economic stimulus package should focus on providing broadband to areas that don't yet have it or on also increasing speeds and encouraging more broadband competition.

A grant program would go directly to broadband needs, Windhausen said. But others have suggested a grant program would take time to set up, while tax credits could happen immediately after the stimulus package passes through Congress.

"Grants can go straight to the markets that need it most," Windhausen said.

Educause's plan focuses both on bringing broadband to areas that don't have it and on improving the speed of existing broadband, but Rick Cimerman, vice president of state government affairs at the National Cable and Telecommunications Association (NCTA) suggested that broadband stimulus money should go first toward unserved areas. NCTA members offer broadband to about 92% of U.S. households, but much of the last 8% is in areas that will be difficult to serve without government incentives, he said.

In general, broadband providers are "doing pretty well" at rolling out service and improving speeds, Cimerman said.

Whatever Congress approves, state and local governments need help bringing government and private programs together to improve broadband, said Aneesh Paul Chopra, secretary of technology for Virginia. Several public and private programs already exist, but it's difficult for states to "stitch together" those programs to build out broadband, he said.

"Every single Virginian should have a chance to play effectively in the 21st century digital economy," Chopra added.

Copyright © 2009 IDG Communications, Inc.

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